TAX BURDEN RISES FOLLOWING AUTUMN STATEMENT

/in /by

The UK’s tax burden will rise after Chancellor Jeremy Hunt reduced the threshold on the top rate of tax and announced freezes on other taxes in the Autumn Statement.

The threshold for the top 45% additional rate of income tax was cut to £125,140 from £150,000.

The government is also fixing other personal tax thresholds within income tax, NICs and inheritance tax for an additional two years, until April 2028.

The Dividend Allowance will be reduced from £2,000 to £1,000 next year and £500 from April 2024.

In addition, the capital gains tax exemption will be reduced from £12,300 to £6,000 next year and then to £3,000 from April 2024.

As energy prices continue to drive inflation, the Chancellor confirmed that the Energy Price Guarantee will be extended for a year from April 2023. However, the level at which typical bills are capped will increase to £3,000 a year from £2,500.

The windfall tax on the profits of oil and gas firms was increased from 25% to 35% and extended until March 2028.

The Chancellor also announced a £13.6 billion package of support for business rates payers in England. To protect businesses from rising inflation, the multiplier will be frozen in 2023/24, while relief for 230,000 businesses in the retail, hospitality and leisure sectors was also increased from 50% to 75% next year.

Mr Hunt also confirmed the National Living Wage (NLW) will rise from £9.50 to £10.42 an hour, while the triple lock on state pensions was protected.

The Chancellor said:

‘There is a global energy crisis, a global inflation crisis and a global economic crisis. But today with this plan for stability, growth and public services, we will face into the storm. Because of the difficult decisions we take in our plan, we strengthen our public finances, bring down inflation and protect jobs.’

Internet links: GOV.UK

NEW PM MUST RESTORE CONFIDENCE, SAY BUSINESS GROUPS

/in /by

The UK’s new Prime Minister Rishi Sunak must restore confidence in the country’s economy, say business groups.

Mr Sunak will have to deal with a range of issues stemming from inflation and the cost-of-living crisis.

Business groups say he will need to set out plans to deal with soaring energy bills, labour shortages, spiralling inflation, and climbing interest rates.

Shevaun Haviland, Director General of the British Chambers of Commerce (BCC), said:

‘The new Prime Minister must be a steady hand on the tiller to see the economy through the challenging conditions ahead.

We cannot afford to see any more flip-flopping on policies – the UK’s businesses need a sustainable, long-term economic plan they can believe in.

We need a clear long-term vision of how the new Prime Minister will deal with the challenges ahead and create the business conditions that allow firms, and the communities that rely on them, to thrive.’

The BCC says business need more certainty on the energy support package for businesses and how the system will work from April.

In addition, it says the government must set out a strategy to boost international trade and exports.

Tony Danker, Director-General at the Confederation of British Industry, said:

‘The new Prime Minister can lose no time in easing the impact of market turmoil on households and firms, and helping to restore fiscal credibility.’

Internet links: BCC website CBI website

SELF ASSESSMENT CLOCK TICKS DOWN TO UNDER 100 DAYS

/in /by

HMRC has reminded taxpayers that they are now less than 100 days until the deadline for self assessment online return submission.

Self assessment taxpayers have until 31 January 2023 to submit their online return for the 2021/22 tax year.

According to HMRC, more than 66,000 taxpayers beat the clock and filed their tax return on 6 April – the first day of the new tax year.

HMRC is now encouraging others to complete their return as soon as they can so they know what they owe and can budget to make the payment by 31 January 2023. This also means that if a repayment is due, it can be claimed back sooner.

Last year, more than 95% of taxpayers filed online and those who submit their returns early still have until 31 January 2023 to pay.

Speaking on 24 October, Myrtle Lloyd, HMRC’s Director General for Customer Services, said:

‘With 100 days to go until the online deadline, there’s still time to complete your tax return, to budget and look into the range of payment options if you need to.’

Internet link: HMRC press release